Credit Suisse UBS deal: UBS set to take over Credit Suisse, seeks $6 billion guarantee UBS seeks $6 billion government guarantee for Credit Suisse takeover
Union Bank of Switzerland (UBS) is under pressure from local governments to bail out Credit Suisse. Now UBSO has agreed to it, only asking for a guarantee of $6 billion from the Swiss government.
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The Credit Suisse bank crisis has become widespread in Switzerland, considered a tax haven. Credit Suisse’s rival bank UBS is under intense pressure from Swiss regulators over its acquisition. Now it has been reported that UBS has agreed to bail out Credit Suisse from the crisis, only for it to ask the government for a $6 billion guarantee.
The boards of UBS and Credit Suisse held separate meetings on Saturday to decide Credit Suisse’s future. Later, a person with knowledge of this potential deal between Credit Suisse and UBS gave this information.
Also Read: Why is the RBI’s close eye on Credit Suisse even after receiving a package of 54 billion dollars?
6 billion dollars will be used in these expenses
UBS has sought a $6 billion guarantee from the government, the agency said, citing sources. This amount will be used to cover Credit Suisse’s closing costs and potential legal costs.
About 10,000 jobs will go
Quoting sources, the news said that talks are underway to restore Credit Suisse’s confidence. It has many potential obstacles. On the other hand, if the two banks are merged, about 10,000 people will lose their jobs.
Credit Suisse or UBS, however, declined to comment on the news.
Also Read: First Republic Bank Gets $30 Billion Lifeline After Credit Suisse, Learn How
UBS is not in favor of forced mergers
According to a Bloomberg report, both UBS and Credit Suisse are not in favor of such a forced merger. UBS wants to maintain its asset-based strategy, and is unwilling to take the risks associated with Credit Suisse. But in this whole situation he is under pressure from Swiss regulators to acquire Credit Suisse.
America’s banking crisis has reached Europe
The banking crisis that began in the US with the collapse of Silicon Valley Bank and Signature Bank reached Europe in the form of Credit Suisse. Switzerland’s central bank has pledged $54 billion in aid to save the 167-year-old Credit Suisse bank. But at the same time UBS is under pressure for acquisitions.
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